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Friday, July 13, 2012

450-mm Fabs Ramp in 2017

The article below tries to project when the semiconductor industry will start building 450 mm wafer Fabs. A key point in the article is
"Gartner estimates that the total R&D cost of 450-mm tool development will cost about $17 billion cumulatively.... He noted that other estimates for the development cost differ widely, from about $10 billion at the low end to as much as $25 billion to $40 billion at the high end."

The large size and range of the $10 to $40 billion cost for tools development indicates that development will be slower than expected.

" By increasing the diameter of the wafer by 50% from 300 to 450 mm, the area will increase by 2.25x. And if the incremental cost for processing the larger wafer can be held to 12.5%, which may be achievable, the cost per area for the 450 mm wafer will be half that of the 300 mm. " ....

"The “elephant in the room” is how the semiconductor equipment manufacturers will recover their investment to develop the new equipment required to move to 450 mm. At this year’s SEMI Industry Strategy Symposium (ISS), Mike Splinter chairman and CEO of Applied Materials pointed out that the 300 mm wafer equipment had a total industry investment of $12 B which took fourteen years to recover. The current estimate is $15 to 20 B for the development of 450 mm equipment with an unknown time to recover. Obviously a topic of much “discussion” and “negotiation” between equipment suppliers and semiconductor fab operators – integrated device manufacturers (IDMs) and foundries alike."

SAN FRANCISCO—The first production semiconductor fabs to use 450-mm wafers are projected to commence operation in 2017, according to Christian Dieseldorff, a senior analyst with the fab tool vendor trade group SEMI's industry research and statistics group.

In a presentation at the Semicon West tradeshow here Monday (July 9), Dieseldorff predicted that three 450-mm fabs would commence operation in 2017. By that time, the total number of IC production fabs will have declined to 441, down from 464 this year, according to Dieseldorf.

Number of fabs beginning operation or in production in 2007 and estimates for 2017.

Several industry development projects are now focused on developing tools for 450-mm wafers, which leading edge chip makers want to transition to in order to increase the number of die per wafer, and thus profitability. Among these projects is the Global 450 Consortium, a $4.8 billion collaboration housed at the Albany NanoTech complex in New York and backed by semiconductor industry heavyweights Intel Corp., IBM Corp., Globalfoundries Inc., Samsung Electronics Co. Ltd. and Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC).

Although the leading chip makers seem bent on moving to 450-mm wafers as quickly as possible, uncertainty remains about when development work will be completed and how many other chip vendors will follow their lead to larger wafers.

At the same event where Dieseldorff spoke Monday, Bob Johnson, research vice president for semiconductor manufacturing at Gartner Inc., said widespread adoption of 450-mm wafers would not occur until 2018 at the earliest, but more likely in 2019 or 2020.

Johnson predicted that the first alpha 450-mm development tools would be available late this year or early next year, with the first production tools not expected until 2016 or 2017. Johnson said there are a lot of predictions within the semiconductor industry about how difficult or easy the transition to 450-mm wafers will be, but that until people begin using 450-mm tools to process wafers, it is not possible to accurately predict how the larger wafers will react to the rigors of semiconductor manufacturing or how smoothly the transition will occur.

"You just don't know these things until you try them," Johnson said.

Johnson said that if the transition to 300-mm wafers in the early 2000s is any guide, chip makers would first construct large 450-mm fab shells but equip them sparsely while they "debugged" the process.

R&D investment estimates vary

Gartner estimates that the total R&D cost of 450-mm tool development will cost about $17 billion cumulatively, about $2 billion of which is being spent this year, Johnson said. He noted that other estimates for the development cost differ widely, from about $10 billion at the low end to as much as $25 billion to $40 billion at the high end.

"We aren't going to know what the [real] numbers are until we start getting some of these tools together and start putting them in production," Johnson said.

Johnson added that he believes the transition to 450-mm wafers is inevitable and predicted that the top 10 wafer fab equipment suppliers would contribute 80 percent of the R&D required to support the transition.

On Monday, Intel Corp. announced it planned to purchase a roughly 15 percent stake in leading lithography tool vendor ASML Holding NV as part of a $4.1 billion equity and R&D funding investment intended to accelerate the development of 450-mm capable tools and extreme ultraviolet (EUV) lithography. Also Monday, the Flemish Minister of Innovation, Ingrid Lieten, announced a commitment to invest in the building of clean room facilities for 450-mm diameter wafer processing at the IMEC research institute's pilot wafer fab in Leuven, Belgium.

Dieseldorff said SEMI estimates that total spending on front end chip fabs in 2012—including both fab construction and cost of equipment—will be between $59 billion and $60 billion, roughly flat with 2011. SEMI expects spending on front end fabs to grow 2 percent to 5 percent in 2013 to between $61 billion and $63 billion, he said.

SEMI estimates that total fab equipment spending, including discrete IC fabs, will total about $38.9 billion in 2012, roughly flat with 2011, Dieseldorff said. The trade group estimates that fab equipment spending will increase 20 percent in 2013 to $46.8 billion, he said.

Meanwhile, the estimated amount of spending on fab construction is expected to be slightly more than $6 billion in both 2012 and 2013, down from about $6.25 billion in 2011, Dieseldorff said. He added that the expectations for fab construction investment have increased in recent months with new projects announced by the likes of TSMC, Samsung, United Microelectronics Corp. (UMC), Semiconductor Manufacturing International Corp. (SMIC) and others. "The outlook for construction spending has improved dramatically" from previous estimates of double-digit declines, he said.

Despite pressure on the Japanese semiconductor industry in recent years, Japan continues to have more chip fabs than any other region, Dieseldorff said. By 2017, the total number of chips fabs in Japan is projected to decline to 105, down from 152 in 2007, Dieseldorff said. The number of fabs located in the Americas, which has the second highest number of fabs of all regions, is forecast to fall to 95 in 2017, down from 123 in 2007, he said.